Mobile Advertising: Google Acquires AdMob

Google announced yesterday that it is acquiring AdMob, the current leader in the US mobile display advertising space.

Google’s no stranger to the mobile space themselves. They have been offering advertising on their mobile search platform since fall of 2005; and the Android operating system (launched in 2008) is a clear play to stay relevant as more and more people use the internet from a handheld device. This year, they’ve doubled down on their mobile strategy, working hard to expand Android to new devices and networks, strengthening their mobile analytics offerings, and now acquiring AdMob.

In North America, mobile advertising is still in its very nascent stages. Traffic is still a small fraction of what you see with traditional search and display advertising, and there is plenty of debate about whether mobile advertising can match the value of traditional online advertising. On the one hand, there is less space on the screen and therefore fewer things competing for the browser’s attention. On the other hand, the small screen can make it difficult to create compelling and effective landing pages.

Whatever your thoughts on the value of mobile advertising, there is no doubt that mobile internet browsing is poised to grow tremendously over the next few years – and there are a lot of reasons to get excited about that.

Most notably, mobile browsing offers the opportunity to geo-target hyper-specific local areas. When users are browsing the internet on a laptop or desktop device, advertisements are geo-targeted based on IP address. IP address targeting is inherently flawed – for instance, anyone using AOL has an IP address located in Reston, Virginia, regardless of where they are physically located. Mobile devices offer the opportunity to target by GPS tracking – which allow you to accurately target not only the user’s city location, but even the specific neighborhood, or street where they’re located at the moment they load the ad. This obviously opens up tremendous opportunities for local businesses. Imagine if you could target ads to users who were literally standing right around the corner.

Also, many people make the mistake of assuming that mobile advertising means cell phone advertising, which isn’t necessarily the case. New non-phone internet-capable mobile devices are popping up all over the place, from the iPod Touch to the Amazon Kindle and Android-driven Nook.

Few question that the mobile internet is one of the “next big things” in the online world. Many businesses are putting off advertising in the space because they believe there just isn’t a mobile audience for their products or services – and they may be right, for now. But the space is growing at break-neck speed, and competition for ad real estate will only get tighter with time. Why not get in now?